Conservative or Liberal, Deist or Pagan, Jersey transplant or Lehigh Valley native, we're all in this mess together. Let's talk. Let us do no harm. Today's one-liner: "The shortest way to the distinguishing excellence of any writer is through his hostile critics." Richard LeGallienne

Tuesday, April 24, 2012

Tom Corbett, NIZ Deus Ex Machina?

Like a Deus Ex Machina, has Governor Tom Corbett stepped into the NIZ dispute? That's what I've been told by at least five different sources on Monday, none of whom is willing to go on record ... yet. Let me tell the story anyway. That's what we bottom-feeding bloggers do.

Behind the scenes, the action is fast and furious in legal challenges to Allentown's 130-acre Neighborhood Improvement Zone (NIZ), filed by multiple municipalities and developer Abe Atiyeh. Allentown plans to divert Earned Income Taxes from nonresidents who work inside the NIZ, located in the downtown and along the Lehigh River. Instead of passing this local tax revenue back to surrounding municipalities where these nonresidents live, the money will help pay for a hockey arena, hotel, cigar bar, "wellness " center, offices and other improvements to be made over the next thirty years. Developers like Atiyeh are upset that NIZ developer J.B. Reilly is luring other LV businesses into the subsidized rents within the NIZ, which will depress their own property values and reduce the tax base.

The Offers and Counter-Offers

So far, eight local governments have agreed to support a legal challenge being spearheaded by Hanover and Bethlehem Townships. Tonight, Palmer Township might join the party. Developer Abe Atiyeh's lawsuit mirrors the municipal challenge, which attacks the constitutionality of the NIZ statute as special legislation that could only ever apply to Allentown.

Allentown has offered to settle the challenge by allowing affected townships to keep the EIT from current residents who work within the NIZ. But the Queen City would keep the EIT for any employees lured there by J.B. Reilly. For the next thirty years.

Thanks, but no thanks, say townships. They have responded with a counter-proposal. Keep the EIT, they say, but restrict the NIZ to the downtown area.

No dice, says Allentown, which wants that riverfront.

Pawlowski wants Callahan to Suffer For No Vote

In an effort to put the pressure on the Townships, Pawlowski had numerous state legislators like Lisa Boscola call Township officials. He also had the bright idea of getting the LVEDC to support his proposal last week. But in a meeting marred by numerous absences, Bethlehem Mayor John Callahan refused to give King Edwin a carte blanche.

The Allentown Mayor went apoplectic.

King Edwin has reportedly decided to pay Callahan back by offering Easton Mayor Sal Panto a boatload of money to run for Northampton County Exec. You see, in addition being King, Palwowski is also a Kingmaker, at least in his own eyes.

Panto's campaign confirms that they've heard that story, too, but have yet to be approached by Pawlowski. "We will take money for the right reason," a highly placed campaign aide tells me "This is not one of them."

Tom Corbett, Deus Ex Machina?

Tonight, Allentown will make a new proposal to Hanover Supervisors in executive session. This proposal will be repeated to Bethlehem Township Commissioners on Wednesday.

Whatever it is, it might be academic. The battle could be over.

You see, Governor Tom Corbett went ballistic himself when he learned about the NIZ legislation, which was first adopted in 2009. His office has contacted attorneys to inform them that, in his view, the NIZ statute as drafted in unconstitutional and needs to be re-written.

Do Townships have an obligation to make concessions on a NIZ that the Governor himself considers unconstitutional?

Pawlowski Files a SLAPP Suit

But what does the Governor know? Allentown Mayor Ed Pawkowski on Monday filed an obvious SLAPP suit against developer Abe Atiyeh, demanding $150 million for interfering with his grand plans. In the Allentown Mayor's world, a private citizen apparently has no right to petition his government for the redress of grievances, a right guaranteed by the First Amendment. There is no right to challenge the constitutionality of a statute, either. Rex non potest peccare. The King can do no wrong.

The obvious purpose of Pawlowski's suit is to chill public participation in, and open debate on, the NIZ. To make sure everyone gets the point, Pawlowski accuses Atiyeh of a conspiracy "with others as yet unknown," i.e. the other municipalities and other developers.

This tactic works well with his rubber stamps on Allentown City Council, but it's pretty stupid outside the limits of the City Without Limits. And given the Governor's recent pronouncement, it's hard to avoid the conclusion that Abe now has reason to file another suit, this time for attempting to interfere with his constitutional rights.

The Cupboard is Bare

In the meantime, the City is fast running out of money. It has borrowed $55 million, but has entered into contracts for $250 million. It has ordered all the structural steel needed for its new arena, but can't pay for it.

All Pawlowski has to show right now is a big fat hole in the ground, where once upon a time, there were thriving businesses.

At the rate things are going, the Phantoms might be just that in Allentown. Specters. In fact, one unconfirmed rumor out there is that Brooks Brothers is now eyeing up South Bethlehem again.

69 comments:

Do you read this before you post it? Or does your tri corner tea party hats blind you? Holy shit this is the worst entry by you ever.

I love the fact that an alcoholic, disbarred, divorced, non home owner and, bottom feeding blogger has connections to the governor's office. Also you can say that you have many connections and sources but you cannot reveal any them. You are not a lawyer nor a journalist.

Hahaha. I can't wait till that a portion of the arena will be built with Atiyeh's money from the lawsuit against him! Maybe we can build the pentaly boxes with his money! Atiyeh is playing with fire for the last time and is going to be burnt severally for the last time.

Sounds like the state will be stepping in. No need to compromise. Remember the Williams Township Ball Field? At least they don't have half of the steel up for the Arena. Better to look at a hole in the ground than a steel skeleton.

Interesting politics in the Lehigh Valley. There is so much jealousy between Palowski, Callahan and Cunningham that it is crazy. You never know who is with who on any given day. Seems that Panto is the only one that stays friends with all three. That of course could change if he runs against Callahan. That would place the other two squarely on his side in a race for county exec. Things are really getting interesting in little ole Northampton County.

I also read the story of the Penn State Investigation. It appears that after the initial report, The State Trooper used Sandusky's Book "Touched" to investigate further and locate additional victims. The only casualties were innocent employees and Coach Paterno. This after Paterno dedicated his life to Penn State.

"I love the fact that an alcoholic, disbarred, divorced, non home owner and, bottom feeding blogger has connections to the governor's office. Also you can say that you have many connections and sources but you cannot reveal any them. You are not a lawyer nor a journalist".

When people stoop to the above tactic, you know you are on to something big. Rolf's post tells me that you've hit a home run with these new NIZ angles. As always, nice work!

Rolf Oeler impersonator, If Pawlowski were smart, he would rush to the courthouse and withdraw that lawsuit against Atiyeh. It was filed to chill Atiyeh's right to question his own government, and to scare other developers and municipalities from joining in. It is a blatant violation of his civil rights. You cheer this and are willing to impersonate other, all over a frickin' arena? Pawlowski looks bad but people like you look even worse.

I suspect Pawlowski is crafting a deal that pleases Hanover and Bethlehem Township. If it does not appeal to the other municipalites, the suit will be right back where it start, however, with different leads.

If the Arena cannot survive with EIT money, then it is truely a house of cards. If the City believes it is such a small amount of money to warrant a lawsuit, why do they insist on fighting to keep the EIT or any portion of it?

1:39 sounds like she hates me much more than she loves the NIZ. The post is about the NIZ, not me. I realize that you, like many other women, are upset that you can't have me. Maybe you should write about hockey or something.

The law is ideologically aligned with Republican philosophy by allowing an area to keep the revenue generated there. Rielly is a HUGE Corbett supporter, and Abe has included the governor in his lawsuit.

The Governor’s office will now sue Abe. He is in way over his head. Any sympathy that might have come from Corbett's office went out the window with Abe's lawsuit.

I had no idea that my spelling, in fact, sucked so bad, Rolf Oeler Impersonator.

Damn Public (read, Unionized) Education --- I guess I am gonna have to go to Private School in the next life ... meanwhile, YOU really significantly need to increase the pizzazz and style factor if you expect anybody to even begin to buy your act, Rolf Oeler Impersonator.

Just a little friendly advice ... I actually do appreciate the fact that you can clearly spell my name correctly (if not much else) ---- you would be amazed how much difficulty some people seem to have.

Ex-Mayor Ed is done after this no matter the outcome. I only hope that Atiyeh goes after the city for all the expenses he had to use to defend this frivolous suit. This is definitely bad, bad government at its finest. I can't believe the people voted for this type of representation. Geeting must be glowing. Or is he even registered to vote in this area?

Yes the law was passed in 2009 but has been anything but transparent and public. Some of our elected local officials who voted for this legislation, which was sneakily tacked on to the end of the budget bill, did not know or understand what the NIZ was actually all about. The only one who did was Browne and he did not go public and tell anyone. This all came to light when the EIT was going to start to be pilfered for all of us last January.

"The city has a very strong case against Atiyah. He has had two years, and yes the law has been very public, to file a suit. Clearly his intent is malicious at this point."

Its a spurious action by a vindictive Mayor, designed to chill people and townships from exercising their right to question their own government. It makes Pawlowski look like a petty tyrant. This might work with his rubber stamps on City Council, but people outside his little fiefdom demand more transparency and accountability than he is willing to provide.

As indicated in the body of my post, I heard that yesterday from five completely different sources. None is willing to go on record yet, but that might change as the week progresses. In view of the sheer volume of sources from different areas, I felt comfortable reporting it, and making it clear that my sources are unnamed.

I am no trained journalist, but have read enough news accounts referring to unnamed sources to know that this tactic is used.

You are certainly free to conclude I made the whole thing up. I have been accused of that before and the accusers have been proved wrong before.

Is anyone talking about the actual bonds? it seems to me any investor is going to demand a high rate due to the risky nature of the bonds. The way I understand it if the revenue and EIT and other tax grab money fall short of the interest payment, the bond holder gets screwed since they are unsecured and Allentown will not be on the hook for the payment. Who would invest in these? Any investor doing his or her due diligence would certainly be concerned with this arrangement since the tax grab itself is at best questionably legal. I just wonder who the suckers are who would by the bonds. And without the bond sell there is no project. Just wondering....

"I kinda feel sorry for Ed. His political career is finished. Win or lose."

You posters are nuts if you believe that. Pawlowski has established such a strong "Chicago-style" politcial machine in Allentown, he could win again easily without running a campaign. Now Pat Browne is an interesting discussion item. I wonder if he can be re-elected by a larger, more informed and more diverse voting base that actually holds its candidates accountable.

You are smoking dope. With a big hole in the ground and a failed project......They will be throwing him out of office. "Chicago Style" political machine? Are you freak'n nutz. I would hardly call Mike Fleck a political machine. If this project fails....so does Allentown. That's what Ed has stated publically. So with that - Ed fails as well. No?

Ed Pawlowski has never said a nice thing about Panto. Remember Panto beet Pawlowski's advisor Mike Fleck a few years ago for Mayor. Mike Fleck an advisor....that explains this whole mess. Now Ed is Panto's friend. Something tells me that Panto isn't that stupid. I will say this.....Panto is the only one who has made any positive sence about the NIZ. Maybe allentown should hire him to do their PR. Instead all you get is "what's good for allentown is good for the lehigh valley". huh?

In the world of craZy, I think this gets cancelled out? Anything Corbett speaks out against, one should embrace. Anything Pawlowski promotes, one should run from it. It is a double negative when Corbett condemns the Pawlowski'd embraced NIZ. It is kind of like a worm hole in space. You end up in Williams Twsp.

Shouldn't the 6 rubber stampers get a chance to bob their heads on the decision to file a lawsuit which will incur legal expenses? Were the 6 rubber stampers even notified or do they find out in the newspaper?

I think Someone needs to pressure the Governor's office for a statement. He is in a very bad spot on this and I think the taxpayers deserve to know what the gov is thinking exactly. BTW, dumb question, What exactly is unconstitutional about the NIZ?

The NIZ legislation creates a "closed class" with only one member - Allentown. This is because the legislation specifies that membership in the class is a city of the third class based on a population of between 106,000 and 107,000 according to the 2000 US Decennial Census. No other city can ever "join" this class.

Previous legislation has created classes with only one current member (Philadelphia, for example), but the "class" was not closed to the possibility of other cities eventually qualifying.

So, if the NIZ legislation said something like, "Cities of the third class with a population of at least 106,000," that would be constitutional. Bethlehem, Harrisburg and Scranton, for example, could eventually qualify for membership. They cannot qualify the way Reilly , oh, I mean Browne's wife, oh, I mean Browne wrote the legislation.

You have City Council members on record stating they don't know what's in the NIZ legislation, and the Mayor and his Administration have been unable to come up with timely answers to the most basic of questions.

If they don't understand it and know about it, there's no way a judge will hold a private citizen to that standard.

Seems the Mayor and his dream legal team has been wasting their time only negotiating with Hanover & Bethlehem Townships.

Hope they were negotiating with ... Lehigh, Plainfield, Stockertown, Whitehall, South Whitehall. Hellertown, Lower Saucon, Upper Nazareth, Lower Nazareth, Nazareth, Copley/Whitehall School District, Bushkill and soon to be Palmer, Salisbury and even the Macungie’s.

There is blood in the water and the sharks are swarming.

Ed, JB, Pat, Joe and others. The fat lady is singing and the tune is not favorable for the City of Allentown. Congratulations, you all created Harrisburg - the East version.

You are right Bernie. Without knowing how much tax money will be diverted, there is no way to know how much cash is available to service the debt, which would lead any reasonable person to believe there is no way to know how much money worth of bonds can be sold in the first place.

I still want to know who the suckers are who are going to buy these bonds...